Old Latrobe, new owner: Anheuser-Busch explores sale of Rolling Rock beer

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The Wall Street Journal reports that Anheuser-Busch InBev (AHBIF) is considering selling Rolling Rock, a regionally popular beer brand whose sales have been falling for the past few years. This sale is the latest development in a long, sad demonstration of why A-B's fortunes were sinking prior to its purchase by InBev.

The tale of the goose that laid golden egg seems oddly appropriate here. Anheuser-Busch bought Rolling Rock from InBev in 2006, ostensibly with plans to use the brewer as an entry point into the "craft" beer market. However, as anyone who ever drank Rolling Rock could probably have pointed out, the fine brew from Old Latrobe was never really a craft beer. It was a decent, relatively cheap lager, not unlike Genesee Pale Ale or Mickey's. Its target demographic was basically economizing drinkers, college students and, to a certain extent, hipsters who might be attracted to its painted-on labels, cool iconography, and the mildly mysterious number "33" printed on every bottle.

Setting logic and taste buds aside, Anheuser-Busch determined that Rolling Rock was going to be a craft beer, so the brewing conglomerate closed down RR's operations in Pennsylvania, moved the company to Newark, New Jersey, changed the labels, and launched "Rolling Rock Red." In the interests of tradition, A-B kept the original slogan, "From the glass lined tanks of Old Latrobe, we tender this premium beer for your enjoyment as a tribute to your good taste. It comes from the mountain springs to you." Realizing, however, that the legend was now incorrect and could be legally actionable, A-B prefaced it with the words "To honor the tradition of this great brand, we quote from the original pledge of quality."

To put it another way, Anheuser Busch chose to "honor" a "great brand" by buying it out and closing it down. They then reopened the company in a different area and, using a different factory with different ingredients, created a different beer that they marketed as a sort of yeasty tribute to the brew that they, themselves, murdered.

Surprisingly enough, Anheuser-Busch's decision to gut Rolling Rock, undermine everything that made it unique, tart it up as a craft brewer, and attempt to market it to a totally new demographic failed to yield vast rewards. Now, three years later, A-B has been bought out by InBev, Rolling Rock's last owner, and is looking to once again sell the brand. This time, one potential buyer is North American Breweries, which recently bought Labatt USA from InBev.

North American Breweries is a subsidiary of KPS Capital Partners LP, a New York-based private equity firm that recently made headlines with its purchase of Wedgewood. As the owner of one of the world's oldest industrial manufacturers, it seems likely that KPS is the kind of company that recognizes the value of a respected brand name. It will be very interesting to see how they make use of the sad remnants of Rolling Rock's "great brand."

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